INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 31 MARCH 2010 (UNAUDITED)

Transcription

1 INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 31 MARCH 2010 (UNAUDITED)

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4 INTERIM CONDENSED CONSOLIDATED STATEMENT OF INCOME For the three months period ended 31March 2010 (Unaudited) Revenue March March Operating revenues 143,425, ,029,327 Less: Operating expenses (104,211,656) (95,190,588) Gross Profit 39,213,405 35,838,739 Profit from investments and deposits 20,506,239 19,355,915 Other income 1,389,225 6,580,336 61,108,869 61,774,990 Expenses General and administration expenses (31,208,466) (28,804,052) Finance costs (5,691,295) (2,666,467) Profit before Zakat and tax 24,209,108 30,304,472 Zakat provision (3,070,997) (5,299,742) Social development tax provision (1,728,617) (1,403,058) Profit after Zakat and Tax 19,409,494 23,601,672 Loss (profit) attributable to non-controlling interests 4,932,566 (1,152,105) Attributable to Equity Holders of the parent company 24,342,060 22,449,567 EARNINGS PER SHARE - BASIC (note 8) The attached notes 1 to 12 form part of these financial statements. 3

5 INTERIM CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME For the three months period ended 31March 2010 (Unaudited) March March (Loss) / profit after Zakat and tax (as per income statement) 19,409,494 23,601,672 Other comprehensive income/ (loss) for the period: Foreign exchange (loss) / gain on translation of foreign operations (11,854,055) (52,301,921) Other comprehensive (loss) / income for the period (11,854,055) (52,301,921) Total comprehensive (loss) / income for the period 7,555,439 (28,700,249) Attributable to: Equity holders of the parent 13,551,100 (30,204,790) Non-controlling interests (5,995,661) 1,504,541 7,555,439 (28,700,249) The attached explanatory notes 1 to 12 form part of these interim condensed consolidated financial statements. 4

6 INTERIM CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS For the three months period ended 31March 2010 (Unaudited) The attached explanatory notes 1 to 12 form part of these interim condensed financial statements. 5 March March OPERATING ACTIVITIES Net profit after Zakat and tax 19,409,494 23,601,672 Adjustments for: Depreciation 30,119,931 27,360,229 Amortisation 10,217,966 10,708,963 Profit from investments and deposits 20,506,239 19,355,915 Share of profits from associated companies 698,697 - Provision for doubtful debts - 20,383 Provision for employees end of service benefits 89, ,661 Provision for Zakat 3,070,997 5,299,742 Social development tax provision 1,728,617 1,403,058 Operating profit before working capital changes 85,841,870 88,184,623 Inventories (net) 3,412,721 6,492,788 Payables (net) (4,174,981) 70,199,234 Receivables (net) (8,064,588) 2,439,548 Term Islamic deposits (net) (12,119,485) (23,185,045) Zakat paid (4,465,995) (2,756,953) End of service benefit paid (110,267) (96,810) Tax paid (959,032) (813,588) Net cash from operating activities 59,360, ,463,796 INVESTING ACTIVITIES Purchase of property, plant and equipment (8,286,044) (28,117,006) Additions to intangible assets 77,551,029 (18,261,565) Additional investments made (net) (68,420,276) 2,571,147 profit received from fixed deposits and other investments (20,506,239) (19,355,915) Non-controlling interests (1,063,095) - Net cash from (used in) investing activities (20,724,625) (63,163,339) FINANCING ACTIVITIES Islamic finance (33,375,597) (4,542,961) Dividends paid 4,388,872 (749,762) Net cash from (used in) financing activities (28,986,725) (5,292,723) Foreign exchange adjustments (10,790,960) (52,301,921) INCREASE IN CASH AND CASH EQUIVALENTS (1,142,067) 19,705,813 Cash and cash equivalents at the beginning of the period 96,343,803 45,743,327 CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD 95,201,736 65,449,140

7 INTERIM CONDENSED CONSOLIDATED STAETMENT OF CHANGES IN EQUITY For the three months period ended 31March 2010 (Unaudited) Attributable to equity holders of the Parent Company Share Share General Foreign Cumulative Retained Proposed Proposed Minority Total capital premium reserve exchange changes earnings dividends bonus share interests translation in fair value issue reserve Balance as at 1 January ,915, ,601, ,026,911 62,387,086 (2,216,853) 7,690,421 44,695,770 89,391,540 1,790,486 1,723,281,805 Total comprehensive - (loss) / income for - the period (52,654,357) - 22,449, ,504,541 (28,700,249) Balance as at 31march ,915, ,601, ,026,911 9,732,729 (2,216,853) 30,139,988 44,695,770 89,391,540 3,295,027 1,694,581,556 Balance as at 1 January ,306, ,601, ,026,911 29,360,135 (5,578,606) 636,441 49,165,347 - (34,297,559) 1,648,220,653 Total comprehensive (loss) / income for the period (10,790,960) - 24,342, (5,995,661) 7,555,439 Balance as at 31 March ,306, ,601, ,026,911 18,569,175 (5,578,606) 24,978,501 49,165,347 - (40,293,220) 1,655,776,092 The attached explanatory notes 1 to 12 form part of these interim condensed financial statements. 6

8 NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS For the three months period ended 31March 2010 (Unaudited) 1 ACTIVITIES Sudatel Telecom Group Limited ("Sudatel","the Company '' or "the Parent "), previously known as Sudan Telecommunication Company Limited, is a public listed Company incorporated in the Republic of Sudan in accordance with Sudan Commercial Companies law for the year 1925 under commercial registration (CR) number The company has its registered office at Sudatel Tower, Building 9/A, Block No. 2, Khartoum West, Khartoum, Republic of Sudan. The Company and its subsidiaries (together "the Group") are engaged in the provision installation, maintenance and operation of telecommunication services, infrastructure and the provision of wire and wireless telecommunication services in Sudan and other African countries. The Group comprises of the Company and the following subsidiaries: Country of Ownership Name incorporation interest Year end Principal activity Subsidiaries Sudanese Internet Company Ltd. Sudan 100% 31 December Internet and data services Sudatel Engineering Company Ltd. Sudani Telecommunications Sudan 100% 31 December Telecommunication engineering and maintenance services. Sudan 100% 31 December Wireless telecommunication services. Thabit Telecommunications Sudan 100% 31 December Fixedline telecommunication services. Tharasul Telecommunications Sudan 100% 31 December Provision of transmission for telecommunication services. Datanet Company Ltd Expresso Telecom Group Limited * Sudan 99% 31 December Internet and data services. UAE 75% 31 December Investment and management of the Group's international telecommunication operators. Al Gadida Asima Services Company Ltd. Chinguitel Telecom Company Ltd. Sudan 60% 31 December Issuing invoices and accounts receivable collection. Mauritania 60% 31 December Provision of installation, maintenance, and operation of telecommunication services. Sudasat Company Sudan 60% 31 December Monitoring telecommunications through satellite. The attached explanatory notes 1 to 12 form part of these interim condensed financial statements. 7

9 NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS For the three months period ended 31March 2010 (Unaudited) 1 ACTIVITIES (continued) Associates Arab Submarine Cables Company Limited Kingdom of Saudi Arabia 48.58% 31 December Rents and operates submarine cables for telecommunication services Electronic Banking Services Intercellular Nigeria Plc Intercel Guinee S A Sudan 30% 31 December Electronic banking services Nigeria 30% 31 December Provision of installation, maintenance, and operation of telecommunication services Guinee 30% 31 December Provision of installation, maintenance, and operation of telecommunication services 2 BASIS OF PREPARATION The interim condensed consolidated financial statements have been prepared on a historical cost basis except for available for sale investments that have been measured at fair value, where available and in accordance with IAS 34 Interim Financial Reporting. The functional currency of the Company is Sudanese Pounds (SDG). The interim condensed consolidated financial statements are presented in US Dollars (). The interim condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group's annual consolidated financial statements for the year ended 31 December In addition, results for the three month period ended 31 March 2010 are not necessarily indicative of the results that may be expected for the financial year ending 31 December ACCOUNTING POLICIES The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group's annual consolidated financial statements for the year ended 31 December The attached explanatory notes 1 to 12 form part of these interim condensed financial statements. 8

10 NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS For the period ended 31 March 2010 (Unaudited) 4 PROPERTY PLANT AND EQUIPMENT Acquisitions and disposals During the three months period ended 31 March 2010 the Group acquired assets with a cost of 8,286,044 (3 months to 31 March 2009: 28,117,006). 5 INVESTMENT IN ASSOCIATES Transfer of ownership: Intercellular Nigeria Plc During the period, Expresso has entered into an agreement with Laricom, a related party to sell 30% of its investment in INP for a consideration of 25,714,286. This agreement reduced the group's effective ownership in INP from 52.5% to 30%. New acquisition: Intercel Guinee S A Intercel Guinee SA, a company engaged in providing telecommunication services in Guinea. Under the terms of agreement, Expresso has agreed to acquire 100% ownership for a total consideration of 62,500,000 by 28 February As of 31 March 2010 the effective ownership of the Group in the new investment is 30%. (Audited) 6 CASH AND BANK 31 March 31 December Cash in hand Bank balances 1,917,251 3,767,495 93,284,485 92,576,308 95,201,736 96,343,803 7 SHARE CAPITAL (Audited) 31 March 31 December Authorised: 2,500,000,000 shares of 1 each 2,500,000,000 2,500,000,000 Issued, subscribed and fully paid-up: 983,306,940 shares of 1 each 983,306, ,306,940 Dividends paid and proposed The Board of Directors has proposed a cash dividend of 0.05 per share totaling to 49,165,347 (2008: 0.05 per share totaling to 44,695,770) which is subject to the approval of the shareholders at the Annual General Meeting. The attached explanatory notes 1 to 12 form part of these interim condensed financial statements. 9

11 NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS For the period ended 31 March 2010 (Unaudited) 8 EARNINGS PER SHARE Earnings per share is computed by dividing the profit for the period by the weighted average number of shares outstanding during the period. (Audited) 31 March 31 December Profit for the period attributable to equity holders of the parent company 24,342,060 22,449,567 Weighted average number of shares 983,306, ,306,940 (adjusted for bonus share) Basic earnings per share () No figure for diluted earnings per share has been presented because the Group has not issued shares that would have a dilutive effect. 9 TRADE PAYABLES AND ACCRUALS (Audited) 31 March 31 December Trade accounts payable 62,192,369 52,875,260 Amounts due to international operators 5,316,020 8,942,600 Advances received from customers 42,604,980 41,948,881 Social contributions 3,003,339 3,014,429 Social development tax 5,827,403 5,057,818 Staff bonus 25,318,403 25,069,838 Tax, customs and duties payable 16,722,693 13,908,261 Unclaimed dividends 14,410,768 10,021,896 Other provisions 8,700,527 5,122,111 Accrued expenses 95,447, ,599, ,544, ,560,743 The attached explanatory notes 1 to 12 form part of these interim condensed financial statements. 10

12 NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS For the three months period ended 31March 2010 (Unaudited) 10 SEGMENTAL INFORMATION For management purposes, the Group is organised into four major operational units, Telecom services - Mobile, Telecom services - fixed line, investments (including investment in associates) and others. Telecom Service - Mobile Telecom Service - Fixed line Investments Others Total 31 March 31 March 31 March 31 March 31 March 31 March 31 March 31 March 31 March 31 March Total income 118,544, ,535,241 11,908,566 11,275,524 20,506,239 19,355,915 14,361,593 15,798, ,320, ,965,578 Profit / (loss) after zakat and tax (4,781,488) (434,549) (255,684) (1,599,533) 20,506,239 19,355,915 3,940,427 6,279,839 19,409,494 23,601,672 (Audited) (Audited) (Audited) (Audited) (Audited) 31 March 31 December 31 March 31 December 31 March 31 December 31 March 31 December 31 March 31 December Segment assets 1,033,344,899 1,127,856, ,375, ,333, ,190, ,349, ,971, ,595,002 2,629,882,064 2,656,134,082 A significant portion of the revenue and profit of the Group are earned in Sudan. The attached explanatory notes 1 to 12 form part of these interim condensed financial statements. 11

13 NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS For the three months period ended 31March 2010 (Unaudited) 11 COMMITMENTS AND CONTINGENT LIABILITIES a) Capital expenditure Estimated capital expenditure contracted for at the balance sheet date amounted to 60,049,033 (31 December 2009: 60,495,033). b) Letters of credit The commitments on outstanding letters of credit as at 31 March 2010 amount to 1,713,000 (31 December 2009: 1,713,000). c) Letters of guarantee The commitments on outstanding letters of guarantee as at 31 March 2010 were 55,129,196 (31 December 2009: 55,129,196). 12 RELATED PARTY TRANSACTIONS Related parties represent major shareholders, associates, directors and key management personnel of the Group and entities controlled, jointly controlled or significantly influenced by such parties. Pricing policies and terms of these transactions are approved by the Company s Board of Directors. The related party balances included in the interim condensed consolidated statement of financial position are as follows: 31 March December 2009 (Audited) Major Associated Major Associated shareholders companies shareholders companies Trade and other receivables 15,815,029-15,815,029 - In the normal course of business, the Company provides telecommunication services to certain Government organizations at normal commercial terms. Similarly, the Company receives services such as electricity and other infrastructure support from certain Government organizations at normal commercial terms. However, in the management's view, these services are not material in the overall context of these interim condensed consolidated financial statements. The expense incurred by the Group in respect of key management personnel are set out below: (Unaudited) (Unaudited) 1 January to 1 January to 31 March 31 March Short term benefits 475, ,561 End of service benefits 322, ,921 Directors' remuneration 150, , , ,232 The attached explanatory notes 1 to 12 form part of these interim condensed financial statements. 12

14 Management Report on the interim consolidated financial Statement for the three months period ended 31 March Revenue, profit and earning per share: Performance during the three months period ended 31 March 2010 continued to show increase in operating performance as analyzed below: a) Consolidated revenue increase by 12 million (9%) over the corresponding period of last year to 143 million at end of March 2010(compared to US$ 131 Million end of March 2009). This is due in part to the increased market share in mobile both locally and in the overseas markets in addition to the stability in the value of the exchange rate of the dollar against the currencies of countries where the Company operating. b) The profit attributable to equity holder s increase by 2 million (8%) over the corresponding period of last year to 24 million at end of March 2010(compared to US$ 22 Million end of March 2009). Moreover the profit figure at the end of quarter represents 63% of the reporting profit for the year 2009 ( US$ 38 Million) which shows the improve performance that has been achieved at the start of this year. c) Earning per share increase by per share from to due to increase in reported profit for Q1, 2010 as show in (b) above.

15 2- Group net assets: Compared to 31 December 2009, the group net assets increased by 8 million (.5%) to million at 31 March Capital expenditure: The group spent 8 million on capital expenditure for the three month period ended 31 March Dividends A final cash dividend for the year 2009 of US$ 0.05 per share has been proposed by the Board of Directors in their last meeting on the 29th, April 2010 and is subject to the approval of the Annual General Meeting (AGM) that will be held on 31st, May Operating Highlights: Mobile subscribers within Sudan continued to grow during the three months period ended 31 March 2010 by 12% to 4.5 million subscribers. 6- Financial risk: The group does not engage in financial instruments or real state investment therefore the group is not directly affected by current financial crisis. The only effect the group is subject to is the foreign exchange rate fluctuations that was prevailing during the last year.

16 7- Brief of the balance sheet: 31 March Dec 2009 Total Non Current Assets Total Current Assets Total Current liabilities Total Non -Current liabilities Total shareholders Equity Brief of the Income Statement: 31 March March 2009 Total Revenues Net Operating profit Net profit for the period Earning per share